A bidding war is set to break out over the multi-billion takeover of Equity Office Properties, the biggest office landlord in the US.

Several weeks following Blackstone’s $36bn (£18.2 bn) bid for Sam Zell’s EOP, a consortium led by Vornado Realty Trust - the world’s fourth largest REIT – has tabled a $38bn (£19.2bn) offer to buy the company.

Vornado has teamed up with Starwood Capital and Walton Street Capital to put together the bid, which represents an offer of $52 (£26.30) a share and a 7.2% increase over the $48.50 (£24.50) a share Blackstone offer.

The $52 (£26.30) a share bid would be payable in 60% cash and 40% in Vornado stock. Should the deal complete, Vornado would retain roughly half of EOP’s 590 office property portfolio and the remaining half would be shared between Starwood Walton Street Capital. The rival bid is being financed in part by JPMorgan Chase, Lehman Brothers and UBS.